VoIP

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You could save a bundle by making calls over your broadband connection. Dozens of companies now offer Voice over IP services, which let you use your existing phone equipment to call anyone, whether they use a VoIP service or a traditional phone line. You do sacrifice a bit of clarity, but the best offerings can all but replace your traditional phone line for as little as $15 a month.

The aptly named Net2Phone launched the first VoIP service in July of 1996. It was a nifty technology, but the dial-up connections most people used at that time resulted in poor voice quality and lag. Plus, you were tied to your PC.

Today, it's a different story. According to Jon Arnold, an analyst with the research firm Frost & Sullivan, close to 300,000 people now have paid subscriptions to broadband VoIP services. The turning point came in April 2002 when Vonage launched a service that worked independently of your PC. A small converter tapped your household phone lines in to your network so you could make calls using any of the ordinary phones throughout the house.

With Vonage's DigitalVoice service, you get a regular ten-digit phone number, as well as features like call waiting and caller ID. There are also a few perks not available with traditional phone service. Meanwhile, copycat services are popping up left and right, offering similar advantages.

Of course, VoIP isn't without its kinks. For starters, if you lose power or Internet access, you lose service. Plus, Congress and the FCC are debating whether to regulate VoIP services in the same way they regulate telephone networks.

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